The agreement grants a full legal release to Impax and its exclusive distributor, Dava Pharmaceuticals Inc., in exchange for an admission that Purdue’s patents for the drug are valid, enforceable and infringed by Impax’ extended-release oxycodone products.

Hayward, Calif.-based Impax said the agreement also licenses it to sell the products through June 14, 2007, with rights to resume marketing...